Many contractors 'won't benefit from Tory tax plans'

Date: 9th October 2009

The potential impact of a Conservative government on contractors has been discussed by tax experts.

Potential benefits of the new tax break promised at conference this week by George Osborne will depend on firms' relationship with IR35 laws, Contractor UK reported.

The shadow chancellor promised to help business start-ups by cancelling National Insurance contributions for the first ten employees.

This will apply to any firm that begins business within two years of a Tory government assuming power.

Speaking to the news source, Tony Harris at Contractor Money said: "In reality this will only benefit those contractors who are currently inside of IR35.

"In almost all cases, anyone outside of IR35 would be likely to draw a low NI-able salary in the first place so this news will be largely irrelevant for them."

Meanwhile, the Forum of Private Business praised Mr Osborne's proposals.

"For prospective employers, as one of a raft of measures aimed at getting Britain back to work and boosting the country's skills base, abolishing National Insurance for new start-ups stands out as today's key announcement," chief executive Phil Oxford said.